The Kingdom of Saudi Arabia’s energy minister has verified that the nation’s strategic move to suspend its oil output capacity expansion was meticulously deliberated upon, stemming from ongoing market condition assessments.
At the helm of this shift is Saudi Aramco, the state-backed oil behemoth, which has made a decisive pivot to embrace the burgeoning role of renewable energy within the global energy landscape. In a statement made earlier this year, the company disclosed its intention to cease its expansion plans, instead maintaining a steadfast focus on sustaining an oil production threshold of 12 million barrels per day, a directive issued by the Saudi government.
Further elucidations came during a Monday revelation, as the Saudi energy minister underscored the careful consideration behind this decision. Speaking at the International Petroleum Technology Conference in Dhahran, Prince Abdulaziz bin Salman highlighted the evolving identity of Aramco, from an oil-centric establishment to a diversified energy enterprise.
“I think we postponed the investment simply because… we’re transitioning. And transitioning means that even our oil company, which used to be an oil company, became a hydrocarbon company. Now it’s becoming an energy company,”
The Prince also reassured that the kingdom harbors a substantial oil capacity reserve, ready to be mobilized in the event of significant global supply disruptions due to unforeseen conflicts or natural catastrophes.
Amidst these transformative times, Aramco’s CEO, Amin Nasser, has confirmed the company’s preparedness to bolster its capacity if necessary, citing a robust reserve margin of about 3 million barrels.
As the International Energy Agency projects a crest in oil demand by the decade’s end, Nasser conveyed his skepticism about a near-term peak, despite predictions of a new zenith in global oil supply, driven by countries like the US, Brazil, Guyana, and Canada, adding 1.5 million barrels per day to the global output.